Trade Me first-half profit little changed, signals greater growth ahead
Profit edged up 0.3 percent to $38.5 million in the six months ended Dec. 31
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Trade Me Group's [NZX: TME] first-half profit was largely unchanged from the year earlier, although New Zealand's largest online auction site signalled earnings should pick up in the future as it emerges from a period of higher investment.
Profit edged up 0.3% to $38.5 million in the six months ended December. 31 from a year earlier, the Wellington-based company said in a statement. Revenue rose 8.9% to $105.6 million while expenses increased 19% to $38.3 million.
Trade Me signalled it's moving out of a period of higher investment which has dented its earnings growth. Its 19% expense growth in the first half is a pullback from the 28% increase a year earlier, while hiring slowed to 37 fulltime equivalents from 53. The company said it expects a "moderately greater profit growth rate" in the second half of this financial year.
"Our investment in areas like product development, new ventures and bolstering our teams has always been focused on positioning Trade Me for greater growth opportunities in the future," said chief executive Jon Macdonald. "The business is demonstrating good momentum, and we have lots of opportunity in front of us – both in our core business and through extending into new things."
The company is expected to post profit of $82.3 million this financial year, up from $80.2 million in 2015, and $80.1 million in 2014, according to a Reuters survey of analysts expectations. That's expected to step up to $91.2 million next financial year, according to the poll.
Trade Me will pay a first-half dividend of 7.8c a share on March 22, up from 7.7c a year earlier
Chief financial officer Jonathan Klouwens is leaving the company in three months for a role in investment banking, the company said today.
Its shares last traded at $3.84. The stock has shed 8.1% so far this year, a bigger decline than the 3.9% drop in the benchmark S&P/NZX 50 Index.
The stock is rated a 'hold' according to the average recommendation of eight analysts compiled by Reuters.
(BusinessDesk)
Tina Morrison
Wed, 17 Feb 2016
Wed, 17 Feb 2016
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Trade Me first-half profit little changed, signals greater growth ahead
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